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Philip A. Fisher, author of the widely recommended investment book Common Stocks and Uncommon Profits, pioneered the "growth stock school of investing." He advocated buying innovative companies that reside in a growth curve. These companies tend to provide market beating returns over the long term -- for example, over the past five years the S&P 500 Pure Growth index gave investors a 27% annualized return versus 20% for the S&P 500. Beverage companies Keurig Green Mountain (NASDAQ: GMCR) , Starbucks (NASDAQ: SBUX) , and WhiteWave (NYSE: WWAV) all represent growing, innovative businesses that may provide you with extra potential for growth in your portfolio.

Making coffee convenientKeurig Green Mountain (formerly known as Green Mountain Coffee Roasters) mostly sells single serve coffee, tea, and other hot beverages via its K-Cups along with the brewing machines in which K-Cups are used in the United States and Canada. The company is a market leader with four of its coffee makers residing in the top spot by dollar volume, according to Keurig Green Mountain's most recent 10-K. Consumers love the convenience of inserting a K-Cup into the machine to make a single brew of their favorite coffee on the go. Keurig Green Mountain's constant search for new brand partners results in ever increasing variety for the consumer to choose from. The fact that this company mainly operates in the United States and Canada gives it a great deal of global growth potential.

In the most recent quarter, Keurig Green Mountain's revenue and net income grew 4% and 28% respectively. Its free cash flow, however, declined 17% due mostly to the timing of payments in accounts payable and accrued expenses. Keurig Green Mountain's balance sheet stands on solid footing with cash and long-term debt to equity standing at 13% and 6% respectively. The company recently initiated a regular dividend of $0.25 per share per quarter, the first of which will be paid on May 2, 2014 according to Keurig Green Mountain's most recent earnings announcement. This will translate into an annual yield of 0.90% at current price levels.

The innovatorStarbucks sells tea, coffee, and other cold and hot drinks and sandwiches via its company and franchised restaurants and through its various channels such as grocery stores and foodservice. Starbucks is helmed by great management such as CEO Howard Schultz who still owns 3% of the company's shares, meaning at least part of his wealth is tied to the success of his company. Management clearly realizes that innovation serves as recipe for success. For example, Starbucks recently updated its app where customers can send tips to their barista or bring up their loyalty card by shaking their mobile device. In a more notable example of both product and marketing innovation, Starbucks teamed up with Oprah Winfrey to come up with the Teavana Oprah Chai tea brand. This represents an opportunity to boost tea awareness and subsequently its consumption.

In the most recent quarter, Starbucks revenue and net income grew 12% and 25% respectively. However, its free cash flow swung to a negative $1.7 billion due to a one-time payment to Kraft in the settlement of a legal dispute. When backing out that one-time payment, Starbucks' free cash flow increased 34% in the most recent quarter. Starbucks possesses a stellar balance sheet with cash/short-term investments and long-term debt to equity clocking in at 35% and 42% of stockholder's equity respectively. In terms of dividend sustainability, Starbucks paid out a frugal 35% of its free cash flow in dividends in FY 2013. Currently the company pays its shareholders $1.04 per share per year and yields 1.4%.

A healthy choicePeople these days like to eat and drink healthy in order to feel better and to save on health care costs down the road. WhiteWave sells plant based beverages and foods such as Horizon Organic and TruMoo dairy as well as organic produce through its newly acquired Earthbound Farms subsidiary. In 2013, WhiteWave grew revenue 11%. However, its net income declined 13% due mainly to transitional costs stemming from its spin off from Dean Foods, expenses associated with the formation of the China joint venture, the Earthbound acquisitions, and higher distribution costs. Nonetheless, free cash flow increased 8% stemming mostly from the disposal of plant, property, and equipment. WhiteWave has been working to improve its balance sheet by paying down debt, as the company reduced its long-term debt 16% last year. As a result, WhiteWave's long-term debt to equity ratio fell from 98% to 67%.

Looking aheadKeurig Green Mountain will most likely continue to look for new companies to partner with in order to offer an even wider variety of K-Cups. Its recent investment from beverage giant Coca-Cola to develop a Keurig Cold device represents the highest profile partnership to date. Moreover, its next generation of Keurig devices should provide renewed interest among consumers. Look for Starbucks to bring about a tea renaissance resulting from mega partnerships with icons such as Oprah Winfrey. Howard Schultz believes resting on your laurels can spell death in the business world. WhiteWave will most likely provide superior top and bottom line growth once it gets past its transition from Dean Foods. Companies that reside in a growth face come with higher risks often stemming from relatively unproven business models and higher valuations. However, patient investors could get rewarded in the form of superior capital gains and dividends over the long term.

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William Bias owns shares of Coca-Cola and Kraft Foods. The Motley Fool recommends Coca-Cola, Keurig Green Mountain, Starbucks, and WhiteWave Foods. The Motley Fool owns shares of Coca-Cola, Starbucks, and WhiteWave Foods and has the following options: long January 2016 $37 calls on Coca-Cola and short January 2016 $37 puts on Coca-Cola. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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